What if the next big housing reform doesn’t fix real estate
affordability at all? What if it doesn’t lower residential or commercial property costs, doesn’t deliver much extra money to the federal government for many years, but it scares financiers out of the marketplace and makes leasing even harder? 
Since that’s precisely what could occur if Australia changes the Capital Gains Tax discount – and it’s back on the political agenda once again.
Today one of Australia’s leading taxation minds, Ken Raiss and I unload what’s truly going on.
Supporters of the change are saying it’s about fairness. They state it will stop “home speculation,” improve housing cost, and raise billions of dollars for the federal budget plan.
In reality, some politicians and unions are declaring it could be among the greatest levers to finally make real estate more economical for everyday Australians.
And initially glimpse, it sounds plausible. After all, who does not want a more affordable housing market?
But here’s the issue … Real estate markets don’t respond well to slogans. They react to supply and require. They respond to incentives. And they respond to confidence.
And when you alter tax policy, you don’t simply alter federal government earnings. You alter behaviour. You alter investment choices. You change the circulation of cash.
And sometimes, you produce effects nobody meant.
Takeaways
- Housing reform doesn’t lower home rates.
- Capital gains tax is a tax on profit when you sell an assset.
- Supply, supply, supply is the response.
- Don’t make knee-jerk reactions to tax changes.
- Financiers are long-lasting holders, not speculators.
- The CGT discount rate debate is not simple.
- Rents will increase if investors draw back.
- We require more homes integrated in the best locations.
- Wealth creation is about planning and strategy.
- The government requires to focus on supply, not taxes.
Links and Resources:Address today’s trivia question here – https://www.propertytrivia.com.au/
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Yardney
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Ken Raiss, Director of Metropole Wealth Advisory
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